Liquidity Boosted Markets, Not Economy: Strategist

The massive amount of liquidity being injected by governments around the world is boosting investment markets, but doing little to improve the economy, Guy Monson, managing partner & CIO of Sarasin & Partners, told CNBC Friday.

"This liquidity is being injected into markets, it's not being taken up on the ground by borrowers and companies increasing their capex (capital expenditure) and it's flowing into the stock market. So good markets, bad economies," Monson said.

The Federal Reserve has signaled its willingness to buy more assets to put money into the system, while theBank of Japan intervened directly to weaken the yen and slashed it interest rate to zero. The Bank of England is also currently debating whether another round of pumping liquidity into the economy is necessary.